Measuring the intangible…

Measuring time
Image by aussiegall via Flickr

A new subscriber to this blog (thank you, renju87!) had this TED talk posted on their blog and brought it to my attention. The speaker is Chip Conley (CEO of American boutique hotel company “joie de vivre”) and this TED talk dates back to mid 2010. The basic message is about moving from using GDP (gross domestic product) metrics to exclusively measure our “success” as society and evolving to more measurements that get at “Gross National Happiness” measurements. If you’ve followed this thread over the past couple of years, you will have heard a handful of world leaders starting to articulate this argument, and even fund some working groups to look into its practicality. I’ll leave the interested reader to refer to the wikipedia links above to get more background information if interested.

While I found this specific talk a little bit unfocused and wandering at times, Conley does do a good job of presenting the overall case for more focus on “measuring the intangibles”. The general concern, of course, is that without agreed measurement systems in place that are meaningful, it is very difficult to effectively manage against these “intangibles”.

Arguably, this is exactly the issue we are having today with getting more meaningful momentum behind Corporate Social Responsibility (CSR) as we have no agreed measures for concepts like “social responsibility”, so triple bottom line reporting (TBL) becomes problematic. Having spent the better part of 2,000 years developing our economic measures, we have tight, well agreed measurements for financial performance, but only subjective, qualitative, and inconsistent measurements — if any at all — for social and environmental performance. We are certainly seeing some better quantification systems being developed by various social sector organizations, however at this point there are many competing systems, none that I know of cover off the breadth of issues seen across our economy, and all are voluntary systems. As Conley points out in his talk, 94% of business leaders agree that “intangibles are important to their business success”, but only 5% have measurements systems in place for those “intangible” characteristics.

My sense is that we are a long ways off of being able to honestly, consistently, and objectively “measure the intangibles”, and thus make either the GNH or TBL concepts “real and meaningful” as measurement systems. However, I do personally believe we absolutely need to push hard in this direction and figure this out if we are going to be able to figure out a better, more sustainable way forward. Enjoy the TED talk…

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